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Dec 29, 2020 in

Possible Changes to Debt Collection Laws After the Change in Administration

Presidential elections bring a level of uncertainty to every type of business. Will the new administration implement any modifications to existing laws that will impact your cash flow? Or, perhaps pass new legislation around debt collection?

The full extent of President-elect Joseph Biden’s ability to make changes is unknown until the special elections in Georgia decide which party will take control of the U.S. Senate. However, even without his party controlling all three branches, changes are possible. 

Whether you handle debt collection internally or outsource this to a vendor, you need to stay up-to-date on pending legislative changes. Here is a quick look at decisions that could affect your operations. 

CFPB Review

A new Presidential administration means possible changes to the Consumer Financial Protection Bureau (CFPB). 

Earlier this month, Representative Maxine Waters (D-CA-43)—the Chairwoman of the House Financial Services Committee—sent a letter to President-elect Biden urging him and Vice President-elect Kamala Harris to make several changes. 

In this 45-page letter, published on insideARM, she asks President-elect Biden to replace the CFPB’s Director, Kathy Kraninger, with a person who would "aggressively protect consumers". Representative Walters also asks the President-elect to rescind the rule that permits debt collectors to contact consumers via email and text.

According to insideARM, President-elect Biden has chosen Leandra English as the new leader for the CFPB Transition Review Team. English was the Chief of Staff for the CFPB when Biden was Vice President and resigned from that role in July 2018. She was recently the Director of Policy with New York's regulator, the Department of Financial Services. 

He has not announced if Kraninger will continue as the director.  

The Affordable Care Act

President-Elect Biden worked hard to get the Affordable Care Act passed when he was Vice President and mentioned his desire to expand on this act while campaigning for the presidency.  

According to Xtelligent Healthcare Media, President-elect Biden wants to increase the value of tax credits offered for plans sold on the ADA’s individual market. This would eliminate the 400 percent income cap on eligibility and decrease the limit on coverage costs from 9.86 to 8.50 percent. He also wants to create a new public option similar to Medicare. 

How does this affect debt collection? When more people have access to affordable healthcare, the amount of outstanding debt decreases. Also, the number of patients who seek medical care should increase.

As the new administration starts ramping up, there is a great deal of uncertainty. The article in Xtelligent Healthcare Media sums up one certainty, “the next four years will be different compared to the previous administration, and those differences will greatly impact healthcare executives and how they run their organizations.”

Contact Credit Management Company

Since we stay current on all legislation that can impact debt collection, our knowledgeable staff can offer our assistance. To learn how we can help you during this transition to the next administration, contact us